Opera Software and Microsoft have struck a deal that will replace Nokia's Xpress browser with Opera Mini on Microsoft's dying line of feature phones.
Also on Thursday, Opera announced its second-quarter earnings, saying that revenue was up 38% year-over-year, to $101 million for the period.
"The agreement with Opera will enable us to provide continuity of service as we transition from Xpress Browser to Opera Mini," Rich Bernardo, who leads the legacy phone business at Microsoft, said in a statement Thursday.
"We have signed a strategic licensing deal with Microsoft. We are basically taking over the browser building department in Nokia," Opera CEO Lars Boilsesen said during a news conference today that focused on the firm's second-quarter earnings. "This means that Opera Mini becomes the default browser for Microsoft's feature phone product lines and the Asha phones product."
The Microsoft-Opera deal covers feature phones based on the Series 30+, Series 40 and Asha platforms.
Current owners of those phones "will be encouraged to upgrade" from Xpress -- Nokia's home-grown browser that uses Mozilla's "Gecko" engine -- to Opera Mini. New phones will come with Opera Mini pre-installed as the default.
That encouragement will start in October, although Opera has not said what will happen if users decline Opera Mini and want to stick with Xpress. Boilsesen said that the encouragement would come "in different ways."
Like Xpress, Opera Mini relies on an infrastructure of back-end servers that aggressively compress the data before it's sent to the browser.
The deal wasn't a complete surprise. Last month, after Microsoft announced massive job cuts -- 18,500 in all, 12,000 in the Nokia divisions it had acquired in April, or about half of the employees Microsoft absorbed -- BGR India published what it said were excerpts from a memorandum penned by Jo Harlow, who heads Microsoft's phone side, part of the devices group led by former Nokia CEO Stephen Elop.
"We plan to consider strategic options for Xpress Browser to enable continuation of the service outside of Microsoft," Harlow wrote in that internal email.
In the same memo, Harlow said that the Nokia feature phones would immediately shift into what she called "maintenance mode," and that "there will be no new features or updates to services on any Mobile Phones platform." She also said that Microsoft would continue to support current users as the "controlled shutdown of services" took place over the following 18 months.
However, Microsoft took analysts aback this month when it launched a new basic phone, the Nokia 130, which will sell in a limited number of emerging markets for less than $25. The Nokia 130 runs the Series 30+ edition of Nokia OS and will rely on Opera Mini as its default browser.
Today, Microsoft's Bernardo said his company would stay in the low-price market, but notably didn't talk about a timeline or actually contradict the purported Harlow email. "We continue to sell and support classic first and feature phones as well as the Asha range, which have performed well with millions of people who want new mobile experiences at lower price points," said Bernardo.
In June, Opera said that the Android version of its browser would become the default on the Nokia X line of forked-Android smartphones Microsoft inherited from Nokia.
Within a month, however, Microsoft killed the Nokia X after the American technology vendor announced job cuts. "We plan to shift select Nokia X product designs to become Lumia products running Windows," Microsoft CEO Satya Nadella wrote in a July 17 message to employees.
Even with that setback, Opera was bullish about the Mini agreement. "This is a great deal for us. We have dreamed about this for many years, for more than 10 years," said Opera's Boilsesen today.
Financial terms of the licensing deal were not disclosed. "[But] it's profitable from day one," Boilsesen asserted.